Intellectual Property - Export Management: Panel Discussion
China is modernizing its defense capabilities with, at its core, a strong focus on cross domains such as the military-civilian fusion and outer space. The concept of military-civilian fusion involves the use of technological espionage and acquisition of sensitive technologies and data from foreign companies through M&A and foreign investment, in order to develop new weapon technologies.
How should regulations on foreign investments be strengthened in order to prevent this issue?
The Chinese state inserts experts and graduate students to universities and research institutions, as well as industrial spies, into companies in foreign countries with the sole mission to steal sensitive technologies and data.
What measures should be taken in order to prevent this type of espionage while continue furthering international cooperation?
Recently, the United States banned U.S federal agencies from procuring equipment and obtaining services from Chinese companies Huawei and ZTE and regulated heavily the two companies’ supply chain in order to prevent espionage by China.
How have the European and Indo-Pacific countries responded to this issue? To what extent has this espionage by China caused harm in foreign country?
Like the United States, Japan recently strengthened its export controls and, in accordance with WTO rules, decided to exclude South Korea from its white list of countries entitled to receive preferential treatment in trade, after having concerns on national security. In response, South Korea replied with countermeasures, removing Japan from its own white list.
As the issue will be soon discussed at the WTO, what do you think of Japan’s decision to strengthen its measures on export control over national security concerns?
When it comes to transfers of defense equipment to foreign countries, Japan has a particularly cautious posture and applies strict export control measures. This has resulted in difficulties for Japanese defense companies to do business abroad and export their defense equipment.
What should Japan do to further its presence in the international defense market? What can Japan learn from other countries?
The control of defense equipment export should contribute to the exporting country’s national security and regional stability. However, despite the acknowledged necessity of weapons for defence and deterrence, arms have often fallen into the hands and used by terrorists. Along with the difficulty to track movements of weapons in conflict areas, the increase of the number of transferred weapons in these areas is a rising issue.
What measures should be taken to ensure that exports of defense equipment serve regional stability and global peace?